Mikulčík charged over tax fiasco

IN EARLY 2012 a malfunctioning IT system plunged Slovakia’s new Financial Administration, recently created from a merger of the previously separate tax and customs administrations, into chaos, forcing administrative workers to fall back on paper forms and hand-held calculators. One year on, Miroslav Mikulčík, a former head of the tax administration nominated by the Slovak Democratic and Christian Union (SDKÚ), has been charged with the criminal offence of ‘violation of the duties of administering someone else’s property’ based on the 2012 meltdown, the Sme daily reported.“I have not caused any damage,” said Mikulčík, who as the head of the Tax Directorate, signed an amendment to a contract with global IT services IBM on the installation of a new tax collection system, according to Sme.

Miroslav MikulčíkMiroslav Mikulčík (Source: SME)

IN EARLY 2012 a malfunctioning IT system plunged Slovakia’s new Financial Administration, recently created from a merger of the previously separate tax and customs administrations, into chaos, forcing administrative workers to fall back on paper forms and hand-held calculators. One year on, Miroslav Mikulčík, a former head of the tax administration nominated by the Slovak Democratic and Christian Union (SDKÚ), has been charged with the criminal offence of ‘violation of the duties of administering someone else’s property’ based on the 2012 meltdown, the Sme daily reported.
“I have not caused any damage,” said Mikulčík, who as the head of the Tax Directorate, signed an amendment to a contract with global IT services IBM on the installation of a new tax collection system, according to Sme.

The police say that the amendment did not specify the conditions for IBM’s responsibility in the event that the system did not work, something which ultimately occurred and which, according to the investigator, resulted in a “significant change in the economic balance to the disadvantage of the Slovak Republic, which resulted in the system not being supplied on time and to the requested quality”, Sme reported.

The police estimate that damage amounting to €8,780,400 was caused, with spokeswoman Andrea Dobiášová telling TV Markíza that if found guilty Mikulčík might face 10 to 15 years in prison.
Mikulčík, however, has said that he was authorised by the then finance minister, Ivan Mikloš, to sign the amendment to the contract and that the legal department of the tax administration had also approved the deal.

In response to the chaos in 2012 Mikloš sacked Igor Krnáč, the head of the Financial Administration, and faced calls, from the then opposition Smer party, for his own dismissal. Smer claimed that the tax administration in Slovakia had returned to the Stone Age. Mikloš, now an MP for the opposition SDKÚ, refused to comment on charges brought against Mikulčík.

Mikulčík’s background

Mikulčík, who was previously on friendly terms with Mikloš, was head of Slovakia’s Tax Directorate when it was a separate agency, but resigned in April 2011 after former prime minister Iveta Radičová objected to a lease that he had approved in early 2011 to rent premises for the Košice tax office from Nitra Invest, a firm owned by Ondrej Ščurka, a district official of the SDKÚ – the party of Radičová and Mikloš.

Krnáč replaced Mikulčík as head of the Tax Directorate in May 2011 and was then named head of the Financial Administration when it became operational in January 2012.

The Košice leasing deal caused considerable controversy within the SDKÚ and its coalition partners in government and the contract was eventually cancelled.

Nevertheless, the Tax Directorate signed a €6.3-million rental agreement with Nitra Invest just a few months later, on August 22, 2011, with the firm the only bidder in a re-issued tender that was criticised as unfair by Transparency International Slovensko (TIS) and Fair-Play Alliance, two watchdog NGOs.

Shortly after Mikulčík resigned as head of the Tax Directorate, Mikloš hired him, on May 2, 2011, as a personal adviser and he was subsequently named head of the Financial Operations Competence Centre early in 2012.

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